Didn't We Try This Once Before???

[GRG55]

Yep, Pebble Beach, Rockefeller Center, etc. It's deja vu all over again...

Mitsubishi UFJ Loses $506 Million in One Day on Morgan Stanley

Sept. 30 (Bloomberg) -- Mitsubishi UFJ Financial Group Inc. took a $506 million paper loss on its $9 billion investment in Morgan Stanley yesterday after the rejection of the U.S. financial rescue plan sent banking stocks tumbling.

As part of the deal, the Tokyo-based lender agreed to buy $3 billion of Morgan Stanley's common stock for $25.25 a share. The second-largest U.S. securities firm plummeted 15 percent in New York Stock Exchange composite trading to close at $20.99.

The loss underscores the risks involved for Asian companies seeking bargains in the wreckage on Wall Street. Morgan Stanley, Citigroup Inc. and Merrill Lynch & Co. have tapped the region's banks and sovereign wealth funds for money in the past year as falling U.S. home prices triggered the worst financial crisis since the Great Depression...
More...

Morgan's Steve Roach has some interesting comments about the past success of Japanese efforts to expand into global financial services over on the FT video site.

[Supercilious]

Re: Didn't We Try This Once Before???

Yep, Pebble Beach, Rockefeller Center, etc. It's deja vu all over again...

Mitsubishi UFJ Loses $506 Million in One Day on Morgan Stanley

Sept. 30 (Bloomberg) -- Mitsubishi UFJ Financial Group Inc. took a $506 million paper loss on its $9 billion investment in Morgan Stanley yesterday after the rejection of the U.S. financial rescue plan sent banking stocks tumbling.

As part of the deal, the Tokyo-based lender agreed to buy $3 billion of Morgan Stanley's common stock for $25.25 a share. The second-largest U.S. securities firm plummeted 15 percent in New York Stock Exchange composite trading to close at $20.99.

This is a perfect example of negative interest loan. Fed's Hammer Drill at work.

[rj1]

Re: Didn't We Try This Once Before???

I've been working with the Japanese for the last four years. I still can't figure them out.

[GRG55]

Re: Didn't We Try This Once Before???

I've been working with the Japanese for the last four years. I still can't figure them out.

Some day maybe they'll ask themselves "What the hell were we thinking?"...

Japan May Want to Buy Gold, Not Morgan Stanley

Oct. 13 (Bloomberg) -- Looking at the morning headlines, many of us in Tokyo are tempted to have a side of whiskey with our coffee. Or skip the java and go just for the booze.

None more so than the folks at Mitsubishi UFJ Financial Group Inc., who are about to sink $9 billion into Morgan Stanley. That move seemed brilliant when it was announced last month. [No it didn't]. Today, it looks a bit troublesome as shares in the fifth-biggest U.S. bank-holding company drop...

...Given the way markets are cascading lower and global recession risks are growing, Japan's biggest bank is almost better off speculating in companies that produce scotch, canvas tents and canned soup...

...Wouldn't it be a shock if after years of conservatism, a major Japanese bank lost big on a renewed foray overseas? [Actually no, it would merely be business as usual]...

...Weighing the interests of shareholders won't be easy. If markets rebound soon, Mitsubishi UFJ stockholders will cheer the deal. If Morgan Stanley goes the way of Lehman or Bear Stearns Cos., investors will be livid.

Whatever Mitsubishi UFJ decides, one thing is clear: The risk of buyer's remorse has never been bigger in a global system that has never been so shaky.

[GRG55]

Re: Didn't We Try This Once Before???

Some day maybe they'll ask themselves "What the hell were we thinking?"...

And that day may not be that far off. It's a deal, but given the $25.25 conversion price it's not like the deals Buffett has been doing...

Morgan Stanley Seals $9 Billion Mitsubishi UFJ Stake

By Christine Harper
Oct. 13 (Bloomberg) -- Morgan Stanley revised the terms of its $9 billion investment from Mitsubishi UFJ Financial Group Inc., providing the Japanese bank with preferred stock that pays a 10 percent dividend instead of common stock.

Mitsubishi UFJ, Japan's biggest lender, will get 21 percent of the New York-based company as previously agreed, the two firms said today in a joint statement.

...Under the revised deal, Mitsubishi UFJ will get $7.8 billion of convertible preferred stock that will convert to stock at a price of $25.25 per share, down from $31.25. The rest of the investment will be $1.2 billion of non-convertible preferred stock. Both classes of stock pay a 10 percent dividend...